Dunkin’ Donuts Bets On Discounts In Breakfast Battle

Dunkin’ Donuts, in an attempt to increase the company’s share of a competitive breakfast market, plans to expand the number of discounts it offers, according to news from Reuters.

A two for $2 egg and cheese wrap offer increased revenue for Dunkin’ Donuts in the third quarter. The chain offered prizes on large and extra large coffees, and its latest promotion is a two for $5 deal on croissant breakfast sandwiches.

McDonald’s and Burger King have improved their breakfast menu offerings as well. The fast food companies have backed up their food items with low-priced specials.

“Our franchisees are now seeing the value of value, and you will see a lot more in the future,” said Dunkin’ Donuts CEO, Nigel Travis, indicating that franchise owners are beginning to feel more positive about aggressively priced breakfast menu items.

The company is also turning to digital strategies, using data collected through the Dunkin’ Donuts loyalty mobile app to personalize advertisements and promotions for individual customers.

Foot traffic to Dunkin’ Donuts locations was down 2 percent for the quarter, the sixth consecutive quarterly decline. Travis indicated that the decline was due, in part, to several summer hurricanes that closed hundreds of locations. Same-store sales in the U.S. rose 0.6 percent. The company’s stock was up 0.9 percent on Thursday, to $55.90 per share, Reuters reported.

“In the face of intense competition from McDonald’s, we still regard the positive comp as constructive news,” said Maxim Group analyst Stephen Anderson, according to the newswire.

Mobile sales at the chain reached 3 percent this quarter, and many high-volume Dunkin’ Donuts franchises reported sales through the Dunkin’ Donuts mobile app of up to 20 percent. Starbucks, in comparison, reported that mobile accounted for only 9 percent of all U.S. sales last quarter. The company’s net income fell to $52.2 million this year, while last year the company reported an income of $52.7 million.


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